Local-newspaper giant GateHouse Media is laying off journalists across the US in cuts their CEO is calling 'immaterial'

GateHouse media is making cuts across newsrooms for the second time in 2019.Photo credit should read STEPHEN MATUREN/AFP/Getty Images

The local-newspaper giant GateHouse Media is laying off
journalists across the US, multiple sources told Business
Insider.

At least 159 layoffs have been documented at 60 publications.

Mike Reed, the CEO of GateHouse's parent company New Media
Investment Group, downplayed the cuts in an interview with
Business Insider, saying they were "not material" when
considering the scope of the company.

The local-newspaper giant GateHouse Media is making cuts across
US newsrooms for a second time in 2019, following at least 60
layoffs in January and February and first-quarter
losses.

At least 159 layoffs have been documented at 60 local newsrooms
in states including Florida, Pennsylvania, Texas, Ohio,
California, and Massachusetts, with potentially more to come.

A GateHouse employee who wished to keep their name private said
layoffs could number near 200.

When Business Insider talked to Mike Reed, CEO of GateHouse's
parent company New Media Investment Group, he downplayed the
cuts, calling them "immaterial," without providing a specific
number of cuts but denying the 200 number, calling it "a lie."

"We have 11,000 employees, a lot to me is 2,000," he said.

Later, he told Poynter that the restructuring
would affect "a couple of hundred" people, saying
that most employees would be asked to take different roles but
would not necessarily be out of a job. He told Poynter that the
number of actual layoffs would only amount to "more like 10."

Tip?Email Benjamin Goggin at
bgoggin@businessinsider.com.

"We have layoffs and new hires that you would expect with a
company of 11,000 employees," he said. "We're trying to
reallocate expenses and resources from non-sales and non-content
producing places and put those resources and expenses into
producing more content and more sales, which would put us in a
better position for long term success."

Reed said the company plans to hire 30 journalists across the US
in the next 30 days.

But posts on social media and local journalists are telling a
different story. Reporter Andrew Pantazi of the Florida
Times-Union, a GateHouse publication, is the unit chair of the
paper's guild and is
tracking the layoffs in a spreadsheet. He says through
Twitter DMs, emails, and texts, that he's confirmed at least 115
layoffs.

"I want to know what impact these cuts are specifically having
and who is being cut," Pantazi said. "It appears the company is
particularly targeting editors, and it shows how short-sighted
its plan is that it doesn't see the importance of local editors
plugged into the community."

Small cuts at already small publications have left some
devastated. Bill Shaner of Worcester Magazine tweeted Thursday
afternoon that after two editors at the publication were laid
off, he was the only one left.

"I am the only editorial staffer left, with a full paper to put
out next week. Pray for me," he wrote.

The cuts appeared to hit roles across the company, including
editors, reporters, and even part-time staff, according to
testimonials on social media, communications with journalists,
and documents seen by Business Insider.

Also on Thursday, New Media Investment Group announced that
it would extend its $100 million stock buyback program for
another year.

GateHouse says it owns 156 daily newspapers, 364 community
publications, and more than 555 local websites in 39
states.

GateHouse has a reputation for its rapid acquisition of
local newspapers, which in turn leads to deep cuts.

Tom Sofield of the local Pennsylvania publication
LevittownNow.com wrote that the staff was
cut by 70% at the Bucks County Courier Times
after GateHouse acquired it as part of a $17.5 million deal in
2017. In 2018, the company acquired titles including Florida's
Palm Beach Post and Palm Beach Daily News.

Since filing
for bankruptcy in 2013, GateHouse has made
numerous multimillion-dollar acquisitions as part of a strategy
to digitize local papers. In September, GateHouse acquired the
Oklahoman, where it
laid off 37 staffers, according to Poynter. In
April 2018, GateHouse acquired Ohio's Akron
Beacon Journal for $16 million.

The layoffs come amid a dwindling number of local papers in the
digital economy and widespread media layoffs since the beginning
of this year. More
than 2,800 media jobs have been lost so far in
2019, according to a Business Insider calculation.

Update May 24: After the publishing of this article, Mike
Reed sent an internal memo to GateHouse employees calling this
article "misleading" and emphasizing "nothing is more important
to our future than preserving high quality local journalism." You
can read his entire statement below.